The scheme allows qualifying cohabitants who are economically dependent to apply to the court for certain remedies. This includes maintenance, property or pension adjustment orders and orders for provision from the estate of the deceased cohabitant.
As with family proceedings generally, the court has the discretion to adjourn the proceedings to allow for mediation and other alternative dispute resolution mechanisms. Adjournments may be made by the court on its own initiative. It may advise parties to seek reconciliation or mediation with a view to a possible settlement. Either party may request proceedings to be resumed at any time.
The parties to proceedings must disclose details of their assets and income. The court may require disclosure. The court must assess the degree of financial dependence by examining the financial arrangements between the parties in relation to the provision of food, accommodation, recreation, etc.
If the court is satisfied that the qualified cohabitant is financially dependent, and that this dependence arises from the relationship or the ending of the relationship, and that it is just and equitable to do so, it may make more of the relevant orders. These include compensatory maintenance orders, pension adjustment orders and property adjustment orders.
The court has regard to a range of matters, including the financial needs and rights of third parties, the duration of the relationship and the respective contribution – financial and non-financial – of the parties.
The court has regard to a range of matters in deciding whether and to what extent orders should be made. They include:
- the rights and entitlements of any spouse or former spouse of the party
- the financial circumstances, needs and obligations of the cohabitants at present and in the future
- rights and entitlements of any civil partner or former civil partner
- rights and entitlements of dependent children or children of previous relationships of either cohabitant
- the duration of the relationship
- the basis on which they entered the relationship
- the degree of commitment to each other
- the contributions of each made or likely to be made in the foreseeable future to the welfare of the cohabitants or either of them, including contributions made by each of them to the income, earning capacity, property and financial resources of the other
- contributions made by either of them in looking after the home
- the effect on the earning capacity of each on the responsibilities assumed by them during the period of cohabitation
- the degree to which the future earning capacity is impaired by reason of the applicant having relinquished or forgone the opportunity of pursuing an economic activity in order to look after the home
- any physical or mental disability of the applicant
- the conduct of the parties (if the court is of the opinion that it would be unjust to disregard it)
Property Adjustment Orders
The position in respect of the acquisition of property is important. However, the court does not look only to principles of resulting trust or contribution. Neither does it divide assets in the same way as a divorce or judicial separation.
The courts may make a property adjustment order in relation to an asset owned by a cohabitant for the benefit of the other cohabitant or a dependent child. The courts are not limited to finding a beneficial interest under the principles of trust law arising from financial contribution. There a is more open discretion.
The court may order property to be transferred from one cohabitant to the other. It can order property to be settled for the benefit of a cohabitant. Agreements which have been made between the cohabitants for the benefit of each other or their spouse may be adjusted.
Before making a property adjustment order, the court considers whether it is practicable to meet the financial needs of the applicant via a compensatory maintenance order or a pension adjustment order.
An applicant by a qualified cohabitant may be made during the lifetime of either for a compensatory maintenance order. The purpose is to compensate for the financial capacity lost as a result of the cohabitation. The principles are similar to those in relation to spousal maintenance.
A periodical payments order requires the cohabitant to pay an amount for the benefit of the other for a period specified. This may be for up to the life of the cohabitant against whom the order is made. The court may also make an attachment of earnings order, similar to that available in respect of spouses.
The court may order that the periodical payments order is secured in such manner as specified. The order may be charged on assets specified by the court owned by the paying partner. A lump sum order may be made if appropriate. It may be payable as a lump sum or by instalments.
The court may make a pension adjustment order in favour of one cohabitant against the pension of the other. See the general sections in relation to pension adjustment.
The application may be made in relation to retirement benefits and in relation to death in service benefits.
Share of Estate
A cohabitant who qualifies on the above grounds may make an application for a share for the deceased estate. This must be made within six months of the issue of the letters of administration or grant of probate.
If the deceased died more than two years after the relationship terminated, the application may not be made unless he or she has received payments from the deceased. It may be made where the cohabitant is not in receipt of periodical payments if within two years of the end of the relationship, he has made an application for a periodical payment, property adjustment or pension order and this is pending at the time of death or has not been completed.
The cohabitant gives notice to the personal representative of the deceased. The court is to have regard to all the circumstances. If the personal representative is not notified, he may distribute the assets to third parties and is no longer liable. However, if such an order is made, the qualified cohabitant may trace the assets against the beneficiaries.
In deciding whether to make an order, the court considers the rights of other parties. It considers whether proper provision has been made in the deceased’s lifetime. This may have been made by the deceased or by one of the above court orders.
The total value of the order is not to exceed the amount to which the cohabiting person would have been entitled had he been married or a civil partner. It must not affect the legal right share of a spouse, where applicable.
The application for redress must be made within two years of the termination of the relationship. However, existing orders can be varied or discharged after this period. In the case of provision from an estate, the above-mentioned timeline applies.
In exceptional circumstances, an application for redress may be made outside the two-year period. The time limit is only likely to be extended in exceptional circumstances where there is a good explanation for the failure to bring an action within two years.
Cohabitants agreements are valid, subject to certain conditions. They must be in writing and signed. Independent legal advice must be obtained by each.
Legal advice may be taken together, provided the right to independent legal advice is waived in writing. The courts may vary agreements within certain parameters.